Early stage businesses govern their operations more by vision than by a budget. This makes sense, because without a track record it's difficult to develop a credible budget. But over time as the business expands, it needs structure to grow successfully.
If your employees are not accustomed to working with a budget, it could lead to culture shock and the false impression that you are stifling growth or becoming too stodgy. That's why its important to shape your company's culture early on to accept budgets and related controls. First make sure that key employees are familiar with financial statements and how their decisions impact them. Next teach employees how budgeting works, emphasizing that they are flexible and will adapt as the business requires.
Learn more at The Chrisitian Science Monitor.
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